TSLA - Tesla Motors

[fareastwarriors]

Trimmed some at $475.

8)

 

 

 

 

[Jurgis]

https://electrek.co/2020/11/18/tesla-tsla-surges-record-high-mysterious-investor-buying-big/

 

"Even Warren Buffett is rumored to be buying into Tesla."

 

Blue Horseshoe loves Tesla.

[Xerxes]

it is hilarious.

 

I respect Chanos for completely having a short position on Tesla and respect Baron or ARK to have a complete bull case on the name.

On the other hand, Wall Street just sits on the fence, to be safe, and then issues target price after the fact.

 

Not the analyst fault. An assigned sell-side automobile analyst would probably be fired by telling his/her boss: "look boss, you got it all wrong. this is a technology company that happens to make car". Only a full blown buy-side investment firm can take and form an opinion on the possible long-hold position on names like Tesla. Sell-side analysts are great only for segmented names and not disruptors that straddle various departments within an investment bank.

 

High multiples or not, bubbles or not, Market is valuing Tesla at a half-trillion dollars. Take $250 billion out for fluff and cult premium, that still leaves a lot for optionality that market is pricing.

[Gregmal]

There's no replicating Elon, but this guy is pretty colorful.

 

https://twitter.com/henrikfisker/with_replies

 

 

[Broeb22]

Stirring the pot on a Monday...

https://www.greencarreports.com/news/1130369_tesla-model-y-reliability-much-worse-than-average-consumer-reports-says

[Jurgis]

Stirring the pot on a Monday...

https://www.greencarreports.com/news/1130369_tesla-model-y-reliability-much-worse-than-average-consumer-reports-says

 

Major reason why I'm still on the fence of buying Tesla. The car, not the stock. 8)

 

Not in a rush and can wait another couple years. Maybe they will improve the operational side of things.

[fareastwarriors]

Next stop $1 trillion!

 

 

:o :o :o

[JRM]

https://www.theregister.com/2020/11/17/tesla_nand_memory/

 

Probably just needs an OTA update to swap out the memory. 

[Liberty]

https://www.cnbc.com/2020/11/24/elon-musk-overtakes-bill-gates-to-become-worlds-second-richest.html

 

 

"Elon Musk has overtaken Bill Gates to become the world’s second richest person. ($128 billion)"

[Liberty]

Musk giving interview mostly about batteries:

 

[Ballinvarosig Investors]

Today Tesla closed at just $3bn shy of Berkshire.

 

In 20 years time, I think we will still be talking about this historic moment.

 

Has anyone got any thoughts on speculating in this? My guess is once this is the index, it's going to get hammered.

[Xerxes]

Scary

Some 9 years ago, Apple surpassed long-time heavy weight champion Exxon in market cap.

I am sure back then it made no sense seeing a phone maker surpass an industrial giant in a pre-shale oil and gas environment. Yet market saw it correctly.

 

While I hope Tesla will continue to push to change the work, I just hope 10 years from now Berkshire won’t be as irrelevant as Exxon is today.

 

Perhaps this belongs in the thread that talks about BRK 10 years from now

[A Dhandho Investor]

Scary

Some 9 years ago, Apple surpassed long-time heavy weight champion Exxon in market cap.

I am sure back then it made no sense seeing a phone maker surpass an industrial giant in a pre-shale oil and gas environment. Yet market saw it correctly.

 

While I hope Tesla will continue to push to change the work, I just hope 10 years from now Berkshire won’t be as irrelevant as Exxon is today.

 

Perhaps this belongs in the thread that talks about BRK 10 years from now

 

My feeling is that this is more like Microsoft in the 2000's when it was trading at over 50 * PE. Over the next 10 years, the fundamentals of Microsoft improved (a lot), but if you invested at the peak in 2000, you still lost over 50% of your money holding a high quality name over a 10 year time frame.

 

I would also say that Microsoft in the 2000's was a higher quality name than Tesla is today (its fundamentals were better, but also industry wise), but I have been wrong on Tesla for as long as I have been on this forum so don't listen to me.

 

It is probably not unreasonable to expect this to trade up to 2 trillion when Elon announces that he has invested Tesla's excess cash in bitcoin.

[Anglozurich]

"My feeling is that this is more like Microsoft in the 2000's when it was trading at over 50 * PE."

 

Sorry to sound abrupt but I am glad you walked back your statement. Microsoft FY2000: $9.4 billion in net income vs Telsa FY2020: excluding reg credits close to zero? Do you mean better fundamentals as in "$9 billion-of-extra-net income" in fundamentals?! There is a strong chance this could be one of the biggest bubbles of all time. It is nothing like Microsoft in 2000.

[A Dhandho Investor]

"My feeling is that this is more like Microsoft in the 2000's when it was trading at over 50 * PE."

 

Sorry to sound abrupt but I am glad you walked back your statement. Microsoft FY2000: $9.4 billion in net income vs Telsa FY2020: excluding reg credits close to zero? Do you mean better fundamentals as in "$9 billion-of-extra-net income" in fundamentals?! There is a strong chance this could be one of the biggest bubbles of all time. It is nothing like Microsoft in 2000.

 

I think you are barking up on the wrong tree. I am probably the most bearish person on CBF re Tesla, but the share price being where it is,  and with Xerxes arguing that Tesla might be the next Apple just wanted to provide a more nuanced view.

 

But with the stock being disconnected from its fundamentals since more than a year: why couldn't it still go up to over a trillion dollar valuation? I'm actually 100% confident that if Elon Musk indicated that he would invest excess cash in bitcoin, this could add to the rally in the stock.

[Dalal.Holdings]

Thinking TSLA's valuation today is justified is about as silly as thinking it should have been worth only $20-30b last yr (or better yet, $10 per share or $0)...

 

The right answer is somewhere in between.

[Guest longinvestor]

Scary

Some 9 years ago, Apple surpassed long-time heavy weight champion Exxon in market cap.

I am sure back then it made no sense seeing a phone maker surpass an industrial giant in a pre-shale oil and gas environment. Yet market saw it correctly.

 

While I hope Tesla will continue to push to change the work, I just hope 10 years from now Berkshire won’t be as irrelevant as Exxon is today.

 

Perhaps this belongs in the thread that talks about BRK 10 years from now

 

Based on stock price? Or on earnings ? At current trajectory, expect BRK’s economic earnings to have passed $100 Billion. And perhaps the earnings coffers filled with a cumulative  half a trillion .

[Gregmal]

If you've got an itch to short the bubble, perhaps finding something that hasn't proven to be resilient and more or less bullet proof for nearly a decade makes sense. The only way to make money shorting Tesla is to more or less nail every facet of the trade, specifically, right down to the timing. And if thats something you have confidence in your ability to do, there's almost certainly higher upside trades to put on, that would likely coincide with the same catalysts.

[kab60]

It's quiet fascinating how detached from reality this has become, but one could've said that on most of the way up. With S&P inclusion, and continued flows into passive funds from active funds, I have no idea how long this will go on.

 

I can understand the craziness about SAAS, though not most valuations, cause selling business software can be a fantastic business (yet I wonder whether a lot of these highfliers are really all that sticky and won't get quashed by the Microsoft or new "disruptors"), but there's nothing fantastic about producing cars.

 

Teslas numbers tells the story of what this really is - a subscale auto manufacturer. It's not even a good industry if you're massive. Still can't quiet fathom how putting a large battery inside the car changes that dynamic. The only really good business is the one of selling luxury cars ala Ferrari, but Tesla is obviously going massmarket and thus in a complete different direction. Despite a couple of fanatical Elon fanboys I also don't see much brand affinity here in Europe.

 

The recent sales numbers I saw from Europe and China also doesn't exactly scream total domination. The complete opposite actually with some competitors finally waking up and launching what seems like decent vehicles. But it seems like even that doesn't matter for the narrative. I've even seen some say increased competition strengthens the case, because it shows EV's are the future.

 

The Elon Halo is massive. Has there ever been this big of a key man risk in the market?

 

At some point I suppose it'll collapse under its own weight. Possibly after S&P inclusion. But who knows. All I know is to stay the heck away.

 

[JRM]

Did you guys forget that Elon is going to squeeze lithium out of sand?  Probably with his bare hands.

 

Did you guys forget that we are weeks away from 1 million robo-taxis?  You will be able to summon your car from across the country.

 

Elon solved the solar tile puzzle back in 2017 that had been eluding bone-headed engineers for years.

 

 

[A Dhandho Investor]

Better late than never? https://de.reuters.com/article/us-tesla-safety-investigation/u-s-agency-opens-probe-into-115000-tesla-vehicles-over-suspension-issue-idUSKBN287172

 

Result of the investigation: "The NHTSA believes that the issue is related to driver abuse. US drivers are as bad drivers as Chinese drivers"

 

The agency said it was opening a preliminary evaluation into 2015-2017 Model S and 2016-2017 Model X vehicles after receiving 43 complaints alleging failure of the left or right front suspension fore links.

 

Tesla in February 2017 issued a service bulletin describing a manufacturing condition that may result in front suspension fore link failures, NHTSA said.

[Simba]

If you've got an itch to short the bubble, perhaps finding something that hasn't proven to be resilient and more or less bullet proof for nearly a decade makes sense. The only way to make money shorting Tesla is to more or less nail every facet of the trade, specifically, right down to the timing. And if thats something you have confidence in your ability to do, there's almost certainly higher upside trades to put on, that would likely coincide with the same catalysts.

 

I know you know this already, but reminding everyone "The market can remain irrational longer than you can remain solvent".

 

Professor Damodaran updated his Tesla valuation with a DCF model (he bought the stock and sold).

 

His valuation is quite detailed and puts a lot of thought into it, I will quote his blog post. Even in his blue-sky scenario of giving them best of breed revenue ($300B), best of breed operating margins (21% - unheard of for capital intensive industry), his price target is much lower than the price today (approaching $3000 pre-split).

 

"The Make-your-best Company: In this variant, I give Tesla the best possible outcomes on each variable, revenues like VW/Toyota, margins like pure software companies (21.24%), a sales to capital ratio that is higher than any of the sector averages (4.00) and a cost of capital of an auto company (6.94%), and arrive at a value per share of $2106."

 

http://aswathdamodaran.blogspot.com/2020/02/a-do-it-yourself-diy-valuation-of-tesla.html

 

I don't know how long this party ends (1 month, 3 months, 12 months, 2 years, 5 years, 50 years), but my own feeling, is the party will end.

 

In my limited experience, bubbles do end, however, like we saw in 1998-2000, they can last longer than most people think.

 

[Simba]

Scary

Some 9 years ago, Apple surpassed long-time heavy weight champion Exxon in market cap.

I am sure back then it made no sense seeing a phone maker surpass an industrial giant in a pre-shale oil and gas environment. Yet market saw it correctly.

 

While I hope Tesla will continue to push to change the work, I just hope 10 years from now Berkshire won’t be as irrelevant as Exxon is today.

 

Perhaps this belongs in the thread that talks about BRK 10 years from now

 

The issue in my view is the risk / reward

 

Apple EV was $618B* in Q42018 and generated close to $60B* of Net Income (going off of my financial software)

Tesla EV is $566B* today, and generated net income of $0.5B* of Net Income (going off of my financial software - didn't go directly to fillings so #s could be off)

 

Investing in Apple was completely different than investing in Tesla from a valuation point of view

 

At close to the same EV level, Apple has multiples more of OI, NI and CF (and were talking about a massive delta, not 1-2 turns, but potentially 100 turns difference)

 

*(going off of my financial software - didn't go directly to fillings so #s could be off)

[Libs]

<It is probably not unreasonable to expect this to trade up to 2 trillion when Elon announces that he has invested Tesla's excess cash in bitcoin.>

 

I had to laugh at this. I am long Bitcoin and short Tesla ( with play money; I'm not completely mad). A rare combination.

[alpha]

I have an elderly relative who was a pretty savvy business man in his prime. Our family set him up with a smart TV a few year ago which allows him to watch Youtube videos on the TV. At some point about 20 months ago he watched an electric vehicle video on Youtube and ever since then the Youtube suggestion algorithms have bombarded him with "Tesla News" videos produced by people trying to collect referral fees. Despite our efforts to explain to him that these were biased videos, he became convinced by these "experts" that Tesla was a game changer on the brink of world domination. Earlier this year for the first time in 50 years he walked down to his bank branch, opened a brokerage account and purchased 25k worth of Tesla stock.

 

It has been very disturbing to basically observe an app brainwash a comfortably retired person into believing they need to act now and buy this stock even when they have no need for money. I have read many accounts of various investment manias that have occurred over history but this sure seems like a new one.